US Seizes 50K Bitcoins Related to Silk Road Marketplace

Damian Williams, the U.S. attorney for the Southern District of New York, said on Monday that authorities seized 50,676 bitcoins related to Silk Road, a darkweb marketplace, in November.

The bitcoins were valued at $3.36 billion at the time. Now they’re worth $1.04 billion.

The coins were found at an address in Georgia connected with James Zhong. A cash amount of $661,900 was also discovered as well as various precious metals. Zhong pleaded guilty to committing wire fraud in 2012, according to the statement.

The Silk Road was an illegal marketplace on the darkweb, it operated between 2011 and 2013 and primarily used bitcoin as a method of payment. The site collapsed following the arrest of Ross Ulbricht, who is serving a double life sentence and 40 years in prison, without the possibility of parole.

Related:  Bitcoin Miner Crusoe Energy Buys Fellow Flared-Gas Operator GAM

In 2014, U.S. marshals auctioned off several tranches of seized bitcoin, with 50,000 coins being sold for $20 million following a 30,000 coin auction a few months earlier.

Zhong manipulated Silk Road’s withdrawal system by triggering 140 transactions in rapid succession, fooling the system into crediting several external wallets with the bitcoin, according to the statement.

Leave a Comment